A 47-year-old architect who owns a six-person firm in the Midwest is worried that her second-in-command is going to leave and start his own business. Her 15-year practice, which she incorporated five years ago, specializes in high-end residential remodeling, so she spends a lot of time training employees and hiring the right mix of personalities. The small office allows for a studio environment, and it's a size she feels comfortable managing. A partnership isn't part of the business plan, at least not right now. And that creates a potential problem. “I don't want this firm to be a revolving door,” says the architect, speaking under the condition of anonymity. “Keeping the people I depend on is a huge challenge. It's not what I went to architecture school to learn.”

This scenario plays out all across the country in small- to medium-sized firms, especially in hot job markets. Large offices have multiple partners, diverse opportunities for leadership, and a clearly mapped route to the top. But firms that have decided bigger isn't better have to figure out other ways to help talented employees advance their careers—or their staff will likely move on.

Not every up-and-coming architect views firm ownership as a golden handcuff, of course. “I'd consider a partnership, but no one seems to be interested, because of the liability,” the Midwest architect says. The financial risk scares off some young people. Others simply can't afford to pay their share out of pocket. Having a stake in a firm, however, doesn't just mean owning a piece of it. Not-so-big firms can often do better than their large corporate counterparts in offering a high-quality work life: decent hours, a healthy office culture, recognition, and a managerial role.

the flat pack Owners of small- to mid-sized firms seem to agree that an egalitarian environment goes a long way toward keeping everyone engaged. Wheeler Kearns Architects, Chicago, with 12 architects including four partners, has had almost no turnover in its 18 years of practice. Dan Wheeler, FAIA, says the thing that's kept everyone happy is the autonomy they're given on projects from the very first day to closeout. Each person is a project architect, usually overseeing two jobs at a time.

“The key component is to maintain as steep a learning curve as you can, giving employees increasingly challenging projects, either technically or in scale and project type,” Wheeler says. When the firm won a community-design award for a shelter for domestic violence on the Southwest side of Chicago recently, it was architect Jon Heinert—five years with the firm—who made the acceptance speech amid much fanfare, with the mayor present. “Whoever does the work gets the podium,” Wheeler says.

Philadelphia-based Brawer & Hauptman Architects is also 18 years old and a dozen people strong. Like Wheeler Kearns, the firm functions as a studio, although it recognizes junior and senior project architects. Partners David Brawer, AIA, and Michael Hauptman, AIA, who are approaching their mid-50s, are just starting to think seriously about adding associates so they can pass on the firm when they're ready to retire.

Hauptman says he can't compete with larger operations who offer more money and an upper rung on the corporate ladder. On the other hand, many of Brawer & Hauptman's benefits are intangible. “We little guys have to offer a nicer place to work and make sure people are given a lot of responsibility and a variety of projects,” he says. “A lot of our work is for religious and nonprofit organizations. If you're a project architect on that kind of job, you'll do everything—from client contact to picking finishes. Even junior architects, who work on very small projects, do soup to nuts.”

Of course, there's no controlling the vicissitudes of fate and desire, either. “There are people we thought were terrific and we'd have been happy to have them stay. But they wanted to travel or follow their dream of having their own firm, and there's very little you can do to keep them,” Hauptman says. “There tends to be a turnover of younger people in our office, whereas older people are looking for something more permanent. Those are the people you reward with bigger bonuses, if they're continuing to produce.”

Cincinnati, Ohio, architect John Senhauser, FAIA, also believes a flat organizational structure gives people ample opportunity to grow. He encourages his employees to bring in clients and often passes potential clients on to them. The office of six is usually working on 15 projects at a time. “Our culture is about as horizontal as it can be,” he says. “Everybody is a project manager; I work on their projects, and they work on mine.”

That kind of give-and-take works very well for his staff, most of whom came aboard as students. One employee has worked at the firm four times over a 15-year period. Several others worked part time for a while after their children were born, and flexible schedules and paid comp time continue to accommodate competing demands. “We're not working Saturdays or all night long,” says Senhauser. “I hope there's still a studio culture but not one that rewards that sort of exploitation.” The straightforward, practical approach also translates to annual meetings, where budgets, and business and personal goals, are openly discussed.

“Being a partner isn't always a good thing,” Senhauser says. “There are times I feel like saying, ‘I'd make you a partner but I don't think you could handle the cut in pay.' There have been some difficult years in which there was a lot of financial risk to shoulder, and sometimes younger practitioners aren't in a financial position to absorb it.” Still, ownership transition is on his mind. “For this firm to be worth something, I need a way to make everyone else here successful,” he says.

succession story

Sole proprietors may be reluctant to make even a small piece of their firms available to others. By the time they reach their 50s, however, most realize it's in their best interests to mentor employees who can take over the practice. Architectural business consultant Ralph Steinglass, FAIA, the founder of Teambuilders, Manhattan, points out that even if it takes the next-generation principals a long time to pay out the owner, a firm that possesses the talent to keep an office running may attract an outside buyer, if necessary.